SIMON BROWN: I’m chatting now with Bruce Williamson of Integral Asset Management. Bruce, I appreciate the early morning time. You were speculating a week or three back around Afrimat’s cautionary. The deal was out yesterday, buying Lafarge; $6 million is the price; R900 million in debt, pretty much. Afrimat can write a cheque for it. They’ve got that much in cash reserves.
SIMON BROWN: The stated Nav of the business of Lafarge is about R1.4 [billion] – that in itself says a discount. More importantly the, what is it, attribute to profit before interest, tax, depreciation, amortisation was only R38 million. But everyone I speak to says, yes, that R38 million is not actually a proper number. Afrimat can probably get that number maybe 10x, and start doing closer to R350 million, R400 million from this business, which means they’re buying it on a PE of three-ish.
So they’re spreading their wings in a big way in the construction business. We just now need government to come to the party. BRUCE WILLIAMSON: Yes. They are completely in the business. The only new addition is cement, and that just goes sort of hand-in-glove with that construction suite of businesses. I guess we’ve got to assume that we are at rock bottom in terms of government spend on infrastructure, and we urgently need to beef up our infrastructure.